GM-Chrysler talks prompt American Axle workers to buy company stock

The talks between General Motors Corp. [NYSE: GM] and Chrysler have prompted many employees at the American Axle[NYSE: AXL] plant in Three Rivers to bet on the car companies' futures.

They're putting their money on a domestic-auto recovery by buying stock in American Axle and GM, according to United Auto Workers Local 1853 President Rodney Reed. He confirmed rumors that the Three Rivers employees, at least, were buying stock in American Axle, which has been dropping since the company's union workers went on strike some months ago.

The Three Rivers plant makes drive shafts and axles for GM, but it also has some Chrysler contracts, Reed said. Whatever new form those automakers take, workers buying stock seem confident the manufacturers won't vanish, and American Axle will continue to get contracts from the new entity or entities.

Employee stock purchasing has been going on for about three weeks to Reed's knowledge. Price is a major reason, he guessed.

"A few years ago, when it was first issued, American Axle stock was $17, and it's been an up-and-down rollercoaster ever since," Reed said. "I think today it's down to $1.89."

The automakers also look like bargains, he added.

"GM's down to its lowest price in 40 years," Reed noted. "We know history's always shown you're going to rebound after the market bottoms out. So we're hoping a lot of people invest -- but we also know a lot of people don't have any money."

American Axle went through a nearly three-month strike last spring, and UAW members ratified a contract in May that cut wages drastically. Many of the nearly 800 employees took the buyouts offered to those with at least 10 years on the job.